Economics Subsistence agriculture and pastoralism is very common in sub-Saharan Africa In some places, 60-90% of the population is involved in agriculture Pastoralism means moving with animals, grazing Shifting cultivation, where farmers move every few years in search of new land after the soils of their existing plots become exhasuted Then the new plot is cleared and burned (ash adds to soil nutrients temporarily Only 35% of Africans live in urban areas

Additionally, Africa is still dependent on the exportation of raw materials (NEO-COLONIALISM) Foreign trade and investment has grown 146% annually over the last two decades Cash crops: cotton, coffee, tea, cocoa, sugar, tobacco, etc. Africa has some of the poorest countries in the world Most countries continue to provide much of their raw materials exprts to Europe They are politically independent, but they still depend economically on their former colonizers for trade, technology, and other goods and services Foreign ivnestment of $36 billion in 2007 Trade between Africa and the rest of the world (especially Asia now) has steadily increased Bilateral trade between China nd Africa has jumped 45%

By 2015, it is expected that 25% of North American oil will be from Sub-Saharan Africa Ahead of the Middle East It is the focus of intense oil race by the west and china, india, etc. Now, it only has 10% of the oil reserves in the world, but it is starting a race that some are calling a second scramble for Africa Most of the oil is on the coastline, so transportation costs to aquire it are very low It is also very low in sulfer content, which means less refining (which is expensive) is likely Of all new world sources of oil, 1/3 are being found in southern Africa

Neo-colonialism causes two problems:

1. Entire local economies are often based on one or two major exports So if the world price for these items drops, economies could crumble Timber, irone ore 65% of the world’s diamonds come from Africa South Africa, especially About half of the world’s diamonds come from southern and central Africa. The largest gem quality diamond ever found (the 3106.75 carat Cullinan Diamond) came from the Premier Mine near Pretoria. It was found in 1905. Three of the world’s largest gold producers have their primary operations in Africa – Harmony Gold, Gold Fields and Anglogold Ashanti. Approximately $8.5 billion worth of diamonds a year come from African countries. Conflict diamonds are diamonds that originate from areas controlled by forces or factions opposed to legitimate and internationally recognized governments, and are used to fund military action in opposition to those governments, or in contravention of the decisions of the Security Council. As of 2005, it was the Wesseltown Diamond Mine in Kimberly, South Africa, at a depth of 995 meters The world's largest diamond was the Cullinan, found in South Africa in 1905. It weighed 3,106.75 carats uncut. It was cut into the Great Star of Africa, weighing 530.2 carats, the Lesser Star of Africa, which weighs 317.40 carats, and 104 other diamonds of nearly flawless colour and clarity. They now form part of the British crown jewels. Deepest diamond mine 12,000 feet deep (normal is 3,300 ft)

2. Profits from selling raw materials are not as high as those from the sale of manufactured goods

Although many governments are trying to diversify their economies, most are burdened by debt Debt they still need to repay After winning their independence, many African governments borrowed large sums f money They thought the modernization projects they invested in would yield high increases in national wealth…..so they could support their own modernization in time and pay off their debts But modernization projects haven’t always brought the expected results in new revenues And what little money a government may have, it needs to devote partially to repayment of loans (in order to stay in good standing with other big countries who can help it gain further aid later

African economies have limited control over their own fate Internationally and domestically They are affected by (for instance) world oil prices dictated by the US and ME and when it drops, they have to devote more money to energy costs than predicted, which takes money away from what they planned to use it for otherwise

Africa has close to 40% of the world’s landlocked states, which means their trade depends on passing through neighboring countries A product of colonialism…. The european drew the borders Colonial development efforts forcues more on the coastal zones, so these landlocked countries also tend to lack good infrastructure (railroads and roads) between rural and urban